LONDON, Aug 29 (Reuters) - Britain raised its terrorism alert on Friday to the second-highest level with Prime Minister David Cameron saying the Islamic State (IS) group operating in Syria and Iraq posed the country's greatest ever security risk.

The government said there was no evidence an attack was imminent but the assessment of the latest intelligence by security chiefs justified elevating the international threat level to "severe", meaning a strike was "highly likely".

"What we're facing in Iraq now with ISIL (IS) is a greater and deeper threat to our security than we have known before," said Cameron, adding he was "absolutely satisfied that ISIL ... would make specific threats to the UK".

It is the first time since mid-2011 that Britain has been placed on this grade of alert by the Joint Terrorism Analysis Centre (JTAC), the independent body responsible for setting the national threat level.

The national threat level was first published in 2006, just over a year after four British Islamists carried out suicide bombings on London's transport network killing 52 people.

Police chiefs said raising the level to severe would mean a rise in the level of visible patrols, along with other security and protection measures.

White House spokesman John Earnest said: "This is a threat that the United States has been focused on. We've been coordinating closely with our allies, both the Brits, but others in Europe, about countering this threat and mitigating it."

The British move comes less than two weeks after a video released by IS showed the beheading of U.S. journalist James Foley, by a masked knifeman apparently speaking English with a London accent. An investigation to identify the suspected attacker is in train.

Foley's murder prompted demands for extra security measures to tackle Britons travelling to the Middle East to join militant groups. Officials have warned that some who had gone to Syria or Iraq might return to Britain to carry out attacks.

British and European authorities have been warning for many months the Syrian conflict posed a serious terrorism threat, but no specific reason was given why JTAC had raised its alert.

"The increase in the threat level is related to developments in Syria and Iraq where terrorist groups are planning attacks against the West," Home Secretary (interior minister) Theresa May said in a statement.

"Some of those plots are likely to involve foreign fighters who have travelled there from the UK and Europe to take part in those conflicts."

BRITONS IN IRAQ, SYRIA

Officials estimate at least 500 Britons have travelled to Syria or Iraq, where IS has seized large swathes of territory, and London's police chief Bernard Hogan-Howe said on Wednesday it was believed some 250 had since returned.

Counter-terrorism police say there have been 69 arrests linked to fighting in Syria this year, a fivefold rise in the arrest rate compared to last year.

Cameron said he would unveil new laws on Monday to make it harder for Britons to travel to Syria and Iraq to fight, and to tackle radicalisation among Britain's 2.7 million Muslims.

"This will include further steps to stop people travelling, with new legislation that will make it easier to take people's passports away," he told a news conference, adding the cause of the threat was a "poisonous ideology of Islamic extremism".

The alert has twice been raised to the highest level of critical - meaning an attack is imminent - after a plot to blow up transatlantic airliners was thwarted in 2006 and the next year after attempted car bombings in London and Glasgow.

Security chiefs say they have managed to stop at least one major terrorism plot every year since the 2005 bombings, known as the 7/7 attacks, but last year an off-duty soldier was murdered on a London street by two British Muslim converts in what the government described as a terrorist killing.

However, Muslims and some experts have cautioned against Britain rushing through new laws. Muslim groups have criticised a "knee-jerk" reaction from politicians which they said could simply backfire.